Greeley updates Terry Ranch well drilling and pipeline construction; warns of possible tariff costs on pipe

Greeley staff reported June 18 that drilling at state land board parcels for the Terry Ranch project is nearing completion and that pipeline construction for Phase 2 has begun, while staff cautioned that tariffs on steel fabrication could increase project costs.

Will (staff member) told the board that the program involves drilling and constructing 16 wells in the Upper Laramie Aquifer, including pump testing and water-quality sampling at each location. As of the June update, he said 14 wells were completed, one well had been installed but not yet developed (cleaned), and one well remained to be drilled. He said the wells drilled to date range from about 285 to 700 feet deep, with some holes advanced deeper for data collection.

Jim (staff member) said the project will seek a nontributary aquifer determination for the aquifer beneath the 16 state land parcels; staff cited an estimate of roughly 1,200,000 acre-feet underlying those parcels, a figure discussed as part of hydrogeologic analysis during field logging and geophysical testing. Jim emphasized the schedule: well construction and testing are expected to be completed in late July or early August.

On pipeline work, staff reported that Phase 2 (a 36-inch pipeline) is broken into roughly four segments. Segment 1 is complete; segment 2 (work package D), roughly 6.6 miles, began pipelaying the week before the meeting. The city appropriated $29 million this year for segment 2 and staff reported a construction contract of roughly $26 million. Staff said they had requested just over $30 million from the construction escrow so far (about $24.4 million from Wingfoot and $6.1 million from Greeley’s match) and that subsequent segments' design is progressing while easement and utility crossing agreements continue to be negotiated.

Staff also raised a procurement risk tied to tariffs. Jim said the project purchased U.S. steel that a contractor shipped to a Mexico fabrication plant; the contractor has submitted change-order requests tied to tariffs that applied to steel content. Tariff levels discussed in the meeting rose from 25% to as high as 50% in the contractor’s request, and staff said they had retained outside counsel and contacted congressional staff to seek avenues to minimize tariff exposure. Board members asked whether steel could be returned to Texas for fabrication to avoid tariffs; staff said that would likely carry schedule impacts and that they are investigating options.

Board members and staff framed the Terry Ranch program as multi-phased and long-term: planned components include state land board wells, a Terry Ranch pipeline, an on-ranch transmission and distribution network, and a new treatment plant. Staff said the project will be built as funding and easements allow, and that the tariff issue is a material risk under active review.